Saturday, June 17, 2017

"Meet the Chinese Finance Giant That’s Secretly an AI Company"

The smartphone payments business
Ant Financial is using computer vision, natural language processing, and
mountains of data to reimagine banking, insurance, and more.

If you get into a car accident in China, you can simply pull out your
smartphone, take a photo, and file an insurance claim with an AI
system.

That system, from Ant Financial,
will automatically decide how serious the ding was and process the
claim accordingly with an insurer. It shows how the company—which
already operates a hugely successful smartphone payments business in
China—aims to upend many areas of personal finance using machine
learning and AI.

The e-commerce giant Alibaba created Ant in 2014
to operate Alipay, a ubiquitous mobile payments service in China. If you
have visited the country in recent years, then you have probably seen
people paying for meals, taxi rides, and a whole lot more by scanning a
code with the Alipay app. The system is far more popular than the
wireless payments systems offered in the U.S. by Apple, Google, and
others. The company boasts more than 450 million active users compared
to about 12 million for Apple Pay.

Ant’s progress will be
significant to the future of the financial industry beyond China,
including in the U.S., where the company is expanding its interests. The
company’s approach goes around existing institutions to target
individuals and small businesses who lack access to conventional
financial services. Ant acquired the U.S. money-transfer service
MoneyGram in April of this year for $880 million. The company could well
apply the technologies it is developing to its overseas subsidiaries. A
spokesperson for the company says it hasn’t brought Alipay to the U.S.
because existing financial systems provide less of an opportunity.

Yuan
(Alan) Qi, a vice president and chief data scientist at Ant, says the
company’s AI research is shaping its growth. “AI is being used in almost
every corner of Ant’s business,” he says. “We use it to optimize the
business, and to generate new products.”

The accident-processing
system is a good example of how advances in AI can flip an existing
system on its head, Qi says. It has become possible to automate this
kind of image processing in recent years using a machine-learning
technology known as deep learning. By feeding thousands of example
images into a very large neural network, it is possible to train it to
recognize things that even a human may struggle to spot (see “10 Breakthrough Technologies 2013: Deep Learning”).

“We use computer vision for a job that is boring but also difficult,”
Qi says. “I looked at the images myself, and I found it pretty
difficult to tell the damage level.”

Qi speaks a mile a minute,
which seems appropriate given how quickly his company seems to be
moving. Dressed in a smart shirt and dress pants on a sweltering
afternoon in Beijing this May, shortly after giving a speech at a major
AI conference, Qi explained that the company considers itself not a
“fintech” business but a “techfin” one, due to the importance of
technology.

Ant already operates a range of other financial
services besides Alipay. For instance, it provides small loans to those
without a bank account. It assesses a person’s creditworthiness based on
his or her spending history and other data including activity on social
media....MORE